Correlation Between Bukit Darmo and Total Bangun
Can any of the company-specific risk be diversified away by investing in both Bukit Darmo and Total Bangun at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Bukit Darmo and Total Bangun into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bukit Darmo Property and Total Bangun Persada, you can compare the effects of market volatilities on Bukit Darmo and Total Bangun and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Bukit Darmo with a short position of Total Bangun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bukit Darmo and Total Bangun.
Diversification Opportunities for Bukit Darmo and Total Bangun
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Bukit and Total is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Bukit Darmo Property and Total Bangun Persada in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Total Bangun Persada and Bukit Darmo is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Bukit Darmo Property are associated (or correlated) with Total Bangun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Total Bangun Persada has no effect on the direction of Bukit Darmo i.e., Bukit Darmo and Total Bangun go up and down completely randomly.
Pair Corralation between Bukit Darmo and Total Bangun
Assuming the 90 days trading horizon Bukit Darmo Property is expected to generate 1.09 times more return on investment than Total Bangun. However, Bukit Darmo is 1.09 times more volatile than Total Bangun Persada. It trades about 0.1 of its potential returns per unit of risk. Total Bangun Persada is currently generating about 0.05 per unit of risk. If you would invest 4,100 in Bukit Darmo Property on September 2, 2024 and sell it today you would earn a total of 900.00 from holding Bukit Darmo Property or generate 21.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bukit Darmo Property vs. Total Bangun Persada
Performance |
| Timeline |
| Bukit Darmo Property |
| Total Bangun Persada |
Bukit Darmo and Total Bangun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bukit Darmo and Total Bangun
The main advantage of trading using opposite Bukit Darmo and Total Bangun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bukit Darmo position performs unexpectedly, Total Bangun can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Total Bangun will offset losses from the drop in Total Bangun's long position.| Bukit Darmo vs. Bhuwanatala Indah Permai | Bukit Darmo vs. Bekasi Asri Pemula | Bukit Darmo vs. Intiland Development Tbk | Bukit Darmo vs. Perdana Gapura Prima |
| Total Bangun vs. Matahari Department Store | Total Bangun vs. Multi Medika Internasional | Total Bangun vs. Visi Media Asia | Total Bangun vs. Bayan Resources Tbk |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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